Ppp and housing

URBAN DYNAMICS & HOUSING CHANGE -Crossing into the 2nd Decade of the 3rd
Millennium

WS-06: Social Housing: Societal Changes and Political Responses

NIGERIA’S HOUSING POLICY AND PUBLIC-PRIVATE
PARTNERSHIP (PPP) STRATEGY: REFLECTIONS IN
ACHIEVING HOME OWNERSHIP FOR LOW-INCOME
GROUP IN ABUJA, NIGERIA
BY

Bawa Chafe Abdullahi
Department of Estate Management, Faculty of Built Environment,

University of Malaya, 50603, Kuala Lumpur, Malaysia

bawachafe@gmail.com

&

Dr. Wan Nor Azriyati Wan Abd Aziz
Department of Estate Management, Faculty of Built Environment,

University of Malaya, 50603, Kuala Lumpur, Malaysia

wnorazriyati@gmail.com

Abstract
The key objective of Nigeria’s housing policy is the provision of suitable and adequate shelter for all citizens.
The challenge of providing housing in Nigeria, particularly to the low-income group (LIG) is assuming tasking
to government to address. In such a situation, there is paradigm shift from “provider” to” enabler” approach
in housing provision through the strategy of public-private partnerships (PPP). This paper seeks to examine the
practice of PPP in meeting the housing challenge in Abuja, Nigeria. The new approach entails the organised
private sector (OPS) will drive housing development for sale at affordable prices to the low and medium income
groups in the country. From the case study of estates so far developed under the scheme, the findings of the
study shows that the programme was carried out without adequate planning and implementation, mismatch with
the goals of national housing policy (NHP) and emergence of investors buying over the few units developed and
had by implication excludes the target beneficiaries. The study concludes that this strategy does not translate
into the full achievement of the planned objective of the programme.

Keywords: Housing Policy; organised private sector (OPS) Public-Private Partnerships (PPP); low-income
group (LIG); Abuja

ENHR 2010, 4-7 July, ISTANBUL 22nd International Housing Research Conference

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Introduction

Over the years of Nigeria’s historical development, has developed and implemented a number of
housing policies and strategies, in an attempt to address the housing of its citizens and particularly the
low-income group (LIG). Consequently, plethora of literature has been generated on Nigeria housing
policy. The scholars adequately present the fatal failure of the public housing scheme to housed
Nigerians (see Okapala, 1986; Agbola 1990; Awotona, 1987;1990; Ogunshakin & Olayinwola, 1992;
Ikeojifor, 1999b; Ogu, 1999). Thereafter, there were writings from the World Bank and allied scholars
in propagating the idea that through supporting policies to the private sector can adequately tackle the
persistent inadequate response from the supply side (see Drakakis-Smith, 1987; World Bank, 1993;
Pugh, 1994; Ogu, 1999; Ogu & Ogbuozobe, 2001). By 1980s through 1990s, the developing countries
like Nigeria have taken the directive dictated on them by the international agencies most especially
World Bank to henceforth refrain from direct role in housing and adopt market driven policies to
enable housing provision in their countries (World Bank, 1993; Sandhu & Aldrich, 1998). At this
instance, many of the opponents of neo-liberalism through the World Bank condemn the strategy on
the grounds of its likely deepening of exclusionist trends it would further generate on the poor and
LIGs in the developing countries (Baken & Linden, 1993; Ortiz, 1996; Jones & Ward, 1995; Mukhija,
2001,2004).

Despite the enthusiasm for enablement approach, specifically in Nigeria, there are few researches
done on the efficacy of organised private sector (OPS) in achieving the housing of LIGs. Perhaps
might be attributable to the fact that OPS developers presence is not much developed and felt in the
country (Ogu, 1999).However from the little available in the Nigerian housing literature, the OPS are
recognised to have much concentration on housing the upper-and medium-income groups (Ikeojifor,
1997) and generally display the tendency of profit maximisation (Keivani & Werna, 2001a). The
position of Mukhija (2004) that the impacts of the new strategy is not yet adequately defined,
researched and its effectiveness doubtable strengthen the need for this study. With adoption of enabler
strategy, to house Nigerians, particularly the LIG, scholars have begun to express cynicism that the
desired objective might not be achievable from the participation of the OPS (see Keivani & Werna,
2001a; Aribigbola, 2008; Ndubueze, 2009). In this paper, we examine the performance of OPS from
the PPP housing estates developed under Abuja mass housing scheme (MHS). Our purpose is to
examine the practice of PPP and show whether it has improve the LIG in accessing housing
developed under the scheme using case study housing estates developed under the scheme in Abuja,
the capital of Nigeria. The study also intends to demonstrate the efficiency or otherwise of both
government and its private partners in managing housing production and delivery in the city

An overview of Nigeria housing policy and its attempt to address the LIGs housing in
Nigeria

Nigeria as a country came into existence in the 20th century during the period of colonialism. It gained
a political independence from British on the October 1st, 1960. The country has a political structure
that comprises of 36 states, 774 local government areas and a Federal Capital Territory (FCT), Abuja.
Nigeria is located in the western part of Africa, considered as the heart of Africa and has a land area


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about 930,000 square kilometres and inhabited by over 150 million. Also more than 50 % of the
population live in its urban centres (UN-Habitat, 2008). Economically, according to World Bank
(2010) Nigeria is classified as low-middle income country with a gross national income (GNI) of
US$175.6 billions. And it has GDP growth rate of 3.0 %, per capita income of US$1,160 and about 84
% of the population below US$2 a day. Nigeria is an OPEC member country and it occupies 7th
position among these crude oil producing countries (Opec, 2009) and account for a quarter of Africa’s
crude oil production (Ogwumike & Ogunleye, 2008). From the crude oil sales, Nigeria has realised
revenue of over US$350 billion and has proven oil reserve capacity of 30 billion barrels (Ogwumike
& Ogunleye, 2008).

The introduction of National Housing Policy (NHP) in early 1990s and its subsequent review in early
2000s gave a boost to OPS take position in the provision of housing in the country (FGN, 1991;
2006). A number of policies, incentives and programmes are designed and implemented over the
years to create vibrant OPS in housing sector of the economy and government to retire to a position of
enabler. These include creation of institutional structures; creation of financial mechanisms;
restructuring, strengthening and recapitalisation of the financial institutions; review of laws and
statutes to make them effective and enforceable, creation of new institutions and creation, growth and
professionalization of the OPS in housing sector (Fortune-Ebie, 2006). These changes began in the
major milestone in NHP 1991 that formally recognised the private sector contribution to housing in
the country.

Prior to these changes in Nigerian NHP experiences shows there was overwhelming dominance of the
private sector provision and little contribution from government. The Federal Government did not
recognised housing as part of its social responsibility until the 3rd (1975- 1980) and the 4th (1981-
1985) National Development Plans. The Federal Government carried out a very ambitious housing
scheme on large scale, with the ultimate target of boosting the supply to particularly ameliorate the
acute housing shortage among the LIGs who were worst affected. In particular, during the period of
national housing programme embarked upon by the civilian administration earmarked 80 % for the
low-income. However, after expending colossal of resources worth billions of dollars it recorded a
miserable failure.

However, the government participation in housing was not impressive and in fact it was a failure. In
Nigeria, scholars have shown that the problems of the policies were lack of political wills,
institutionalised policy and continuity, politicisation of the programmes, political corruption, poor
funding and inadequacy of mortgage institutions, poor socio-economic structures, among others have
contributed immensely to the failures (Awotona, 1990; Ikejiofor, 1999b; Aribigbola, 2008; Ndubueze,
2009). The failure of provider approach prompted the government to adopt a change in its NHP
beginning from the NHP 1991. The current policies embrace the private sector as the vehicle to
address the severe shortages of houses in the country. While the government position itself as enabler
and facilitator in the housing delivery in the country.


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Concept of enablement and public-private partnership (PPP)

Over the years in developing countries, the government play the sole or dominant role in all spheres
of economy and public service delivery (Njoh, 2006). The enablement came as paradigm shift from
the ‘provider’ and self-help’ phases, which falls in the third phase from the period of mid-1980s of
housing policy evolution in the developing countries (Choguil, 2007) to adequately house the LIGs.
The self-help and enabler concepts have long history prior to the present time when it is adopted and
encouraged by the international institutions on governments of developing countries (Harris, 2003).
According to Yeboah (2005) argued the practice and debate on self-help housing is what nurtured the
emergence of the concept of ’enablement’ and only became more relevant when the World Bank and
other international institutions started pursuing the neo-liberalism policies (Pugh, 1994a,b). The
enablement as the next guiding principles appeared prominently in the United Nations Centre for
Human settlements (UNCHS-Habitat) documents and publications and from which the UNCHS
(1990) Global Strategy for Shelter (GSS) (Pugh, 1994a).The strategy entails positioning of private
sector and its market efficiency as the next vehicle for housing delivery, while the governments are to
provide an enabling environment from its reformed institutions and regulations to ensure the
sustainability of the market in the difficult task of bridging the polarise gap between demand and
supply of housing and its related infrastructures in the developing countries (World Bank, 1993).

The debate that emerge in the literature and which has no conclusive position, whether informal or
formal market should be vested with the responsibility and accorded with all the deserve policy
support to work towards the attainment of the enablement objective on the platform of private sector
driven housing delivery(Keivani & Werna, 2001a, b). The opponents of the enablement seem to
strongly oppose the formal housing market to take charge of delivery of housing and enable by the
state (Baken & van der Linden, 1993; Jones & Ward, 1995; Ortiz, 1996; Keivani & Werna,
2001b).The general position of these scholars is that the formal private market historically has never
being on the vanguard of provision of housing to the LIG in developing countries and the objective of
profit maximisation would deepen market failures and distortions. Specifically, Keivani & Werna
(2001b) declared that the formal private firms should not be the focus of the enablement to meet the
LIG housing in the developing countries, because by doing so the attempt to develop new policies and
further expansion of the existing policies would be stifled.

On the other hand, earlier research by World Bank (1993) and Malpezzi (1994) suggested that the
formal private market as the strongest element should be enabled in developing countries, because of
their economies of scale to fulfil the desire result of lasting solution to the problem. Not only that, it
would be a platform to launch a new vision of economic development in the developing countries. An
empirical study of Segupta (2006) in India and Abd Aziz (2007) and Salleh (2008) in Malaysia seems
to support this postulation. For instance the study of Segupta (2006) shows that the formal private
sector has impacted on housing in Kolkata with efficiency in production due to the firms’ technical
and marketing expertise. The accountability and righteousness of the public sector strongly
complimented to the realisation of the accomplishment. Similarly, Abd Aziz (2007) and Salleh (2008)
the wonderful success of the private developers in country shows that the housing provision for LIG is
subjected to series of government policy regulations and controls which the private developers were
able perform wonderfully in meeting LIGs dream of home ownership in Malaysia. Given quality

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enabling environment coupled with the government consistent policies and incentives the formal
private sector is capable of meeting the housing of the LIGs in developing countries. There is need to
correct the misinterpretation of enablement that means complete rolling back of the state from
housing provision, when in actually sense the enablement requires more of state involvement in
housing delivery (Mukhija, 2001; 2004; Segupta, 2006).

From the policy documents of the international institutions that sponsor enablement, suggested that
the platform of public-private partnership PPP arrangement would be use as the vehicle of market led
delivery of housing in the developing countries (Sengupta, 2006). This perhaps explains the
increasing emphasis in many countries on the use of PPP (Whitehead, 2007) for housing
development. The fundamental goal of PPP is to share responsibilities between the participating
parties. Depending on the agreement, PPP in housing according to the enablement, the private sector
is entrusted with the responsibilities of physical construction, funding, implementation and in some
cases the management of the disposal. On the other hand the government contribute by setting the
goals, supervision and monitoring, standardisation and provision of legal, institutional, economic
policy frameworks (Sengupta, 2006; Tecco, 2008).

Research methodology

The research methodology uses a two pronged approach namely, quantitative and qualitative. The
research exploits the primary and secondary data sources to enrich the facts for the analysis. The
actual data collection was conducted between November, 2009 and March, 2010. The semi-
structured questionnaires was administered to Directors (or representatives) to the relevant
stakeholder departments in the FCDA. However, just like the experience of Mukhija (2004) the
researcher could not administer the instrument to some developers; even though allowed the conduct
of other research activities in the premises of their gated estates and other bluntly refused same to
participate in the study. However, because of similarity of the operating environment might not distort
the outcome off the study.

Finally, PPP housing estates occupiers/residents constitute the study population and structured
questionnaires, assistance of research assistants, were administered to sample of 400 residents from
the six case study PPP housing estates selected. And the unit of study is the head of household, to
achieve time saving and reduce expense of the study, as it is recognised as an advantage of using such
in household survey (Fisher, Reimer & Carr, 2010). The head of household respondents were selected
based on the order of one house from after every five houses, but at a later time, the selection was
conducted according to the willingness of the household to participate in the study, due to
uncooperative attitude expressed by some of the estate residents. The research survey instruments
were first were coded and analysed by using the SPSS. The Cronbach’s Alpha reliability test of the
instrument obtained the value of 0.638, falling within the range of acceptable reliability. We suspect
the use of different research assistants perhaps might be the reason for the value we obtained. The
results of the study are presented in the descriptive format.


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Abuja the study area

It was in 1976 that Federal Military Government led by Late General Murtala Mohammed enacted
Federal Capital Territory Act (FCT) established Abuja after it has been chosen to be the
administrative capital of Nigeria (Moore, 1984) and with solely administrative functions. This was
after the failure of Lagos due to the problems of inadequate land space for future expansion, terrible
traffic congestion, poor drainage, acute housing shortage and associated costs, unbearable ethnic
influence etc. The planned period for the transfer was to be completed in 1986. However, it was on
12th December, 1991, the final movement of Federal capital to Abuja became a reality.

Abuja is located in the geographical centre of Nigeria (Figure 1a) and lying between latitudes 6
degrees 45’ and longitudes 7 degrees 39’ north of the equator. The land of approximately 8,000
square kilometres was carved out from the then neighbouring states of Kwara, Niger and Plateau to
serve as the FCT and the Federal Capital City (FCC) to constitutes about 250 square metres (IPA,
1979).The government vested all the land in FCT in the Federal Government of Nigeria. The
government also created Federal Capital Development Authority (FCDA), as its agency responsible
for the spatial planning and development of the FCT.


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Figure 1a, b &c
Map of Nigeria showing the location of Lagos and the new Federal Capital Territory (Source: Jibril,
2006:3)
Map of Federal Capital Territory showing the phases of development of Abuja
Map of Federal Capital Territory showing the names of districts in Phase III of Federal Capital
Territory

The FCDA commissioned an International Planning Associates (IPA) to design the master plan of the
city and its report was submitted in 1979.The city is planned to be developed in four phases


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(Figure1b). The bulk of PPP MHS project sites fall within the Phase three (Figure 1c). The phase has
a land area of 163 square kilometres.

The population of Abuja has over years been growing steadily as several censuses had revealed. In
1991 and 2006 National Population Commission (NPC) census the population of FCT of Abuja was
estimated to be 378,671 and 1,406,239 respectively. However, with not up 50 % of planned
development of Abuja attained (Daramola & Aina, 2004); the city is estimated to have a population of
over 6 million, which by far exceeds the original design capacity of 3.2 million when the city is
completed (Imam, Mohammed, Wilson, & Cheeseman, 2008).This geometric increase is reaffirmed
considering the figures reported by UN Habitat (2008) that Abuja was the fastest growing city in
Africa with annual growth rate of 8.3 % per annum and much greater than Mega city of Lagos with
3.74 %.The failures of the administration of Abuja to implement the recommendations suggested by
the IPA (1979) on the achieving housing delivery are apparent. The souring demand and the inability
to access formal housing, the unmet demand necessitated the emergence of informal and unplanned
settlements, numbering over 65 in the Federal Capital Territory (FCT) as symbol of apparent failure
of the city administration (COHRE, 2006). In addition to the stringent policies pursued by the city
administration have seriously aggravated the housing situation to Abuja residents, most especially to
the poor and LIGs (Daramola & Aina, 2004; COHRE, 2006; Jibril, 2006, 2009).

Findings and discussions

Mode of implementation of PPP housing in Abuja

The idea of engaging the practice of PPP in housing development in Abuja is traceable to the
Mabogunje (2001) position paper in 1999. Mabogunje (2001) advocate government to encourage the
development of OPS and made land available to this class of developers in the city. The mass housing
scheme (MHS) commenced in the 2000 under the framework of a PPP (FCTA, 2008). The
implementation of the MHS was first managed by an ad hoc committee and currently under a
substantive department, to effectively co-ordinate the implementation of the scheme (Bamalli,
interview 2009).

The OPS developers were made to sign a development lease, undertaking to complete the
development within 3 years and 18 months under the first round and MAS accelerated development
respectively from the date of signing the agreement. From copies of the agreement made available to
us, the agreement specifies the public sector and private developer responsibilities. It requires the
developers to comply with the city regulations, standards and specifications in the course of
construction of the housing units. The breach of the Development lease agreement was specified in
the document.

Similar to Mabogunje (2001) suggestions, the MFCT only grant the OPS developer access to land to
develop, the title to land rest with the authority. It is after the development and sold out to the general
public that the developer is expected to submit the list of the beneficiaries. The list is to be
accompanied with site development plan, engineering infrastructure design and ‘as-built’ drawing


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with survey data for each plot to the FCTA (DMH, 2009). After all the necessary assessment the
beneficiary is to be issued with certificate of occupancy (C of O) on the payment of relevant statutory
rents and charges.

At the beginning the land allocation was made to the OPS developers at no cost, apart from the
meagre processing fee paid, as government equity contribution to the scheme. Also under the scheme,
the FCTA was to provide primary infrastructure whilst the developer was to provide secondary and
tertiary infrastructures “compliant with the standard specified by the Master Plan of Abuja” (FCTA,
2008:6). However, it was provided in the agreement that where after the completion of the estate, the
government fails to provide the primary infrastructures as stipulated, the developers were allowed to
provide such infrastructures as necessary to make the estate habitable.

The FCTA prepared and revised guidelines of its mass housing programmes. The new guideline
specifically stated that maximum allocation of 10 ha and 20 ha for the scheme can be made for
housing developments in the satellite towns and the city respectively. However, violations of the
guidelines abounds in allocation of excess of the approved maximum sizes, favouritism, fraud are
common (DailyTrustonline, 2010a).

The level of response of participation generated on the PPP housing in Abuja

The promise of reforms package introduced by the government generally serves as the rally point to
attract stakeholders’ participation on PPP housing sector in Abuja. Consequently, there were
tremendous responses of the OPS that enlist in the government policy of private sector-driven housing
development. The bulk of participants were from OPS under the umbrella of REDAN (93 %), and
remaining is shared between international construction companies, public corporations and formal
organisations staff co-operatives enlisted for participation (Table 2). Although there are other
stakeholders participating, the PPP in Abuja have succeed of attracting bulk of participants from the
OPS and corresponds to the original policy document proposal of mobilising and enabling this class
of developers to demonstrate on how best to tackle on housing the LIGs in developing countries.

Table 2. Distribution of participating developers in PPP housing estates in Abuja

S/N Developer Number %
1 OPS 122 93.1
2 Public corporations 6 4.6
3 Staff cooperative 3 1.5
4 International company 1 0.8
Total 131 100
Source: FCTA (2007, 2008)

Considering the opportunities offered many OPS developers have sprung up to access the high valued
and privilege Abuja land given at no cost. The trend of events shows that few joined with genuine
intentions to contribute to the solution of housing problems of Abuja and many are taking the position
of land grabbing opportunity and after the allocation, with the administration connivance subdividing
the plots allocated and sold to interested developers and making unproductive profit. The OPS


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developers selling the lands and enjoying unprecedented gains is becoming a popular business in
Abuja. This is type of OPS are popularly called “land grabbing merchants” or “brief case companies”
firms owned by politicians, proxy civil servants and dubious business men. Paradoxically at the time
of inception there were no guideline principles to ascertain the financial, technical and technological
competence of the participating OPS. According to one official interviewed (Interview,2010) states
that most of the selections and the subsequent allocations of land were made without due process, but
rather based on what he called “man on man relationship” and FCTA (2007; 2008) supported this fact
that all land allocations made were without a verifiable list of the beneficiaries. This add strength to
an earlier trend observed at the early stage of Abuja development that what matters in securing
contracts and land was “patronage rather than on merit” (Moore, 1984:174).

The implication of these developments on PPP housing development, despite the tremendous response
enjoyed, the public sector as major stakeholder of the scheme have displayed absolute incapability of
steering the programme to one of success story due to the absence of an effective administrative
machinery to build the required commitment, coordination and control. For instance as at 2008 there
were only 32 % OPS on site and only 13 % them carrying out the development with approved
building plans (FCTA, 2008). On the other hand, the participating OPS were busy building high
income and luxury homes for the rich Nigerians all over the PPP housing estates, with little or no
consideration to the low-cost housing that will be affordable to majority of Abuja residents.

The land and associated infrastructure provisions under the PPP in Abuja

The literature on Abuja indicates land accessibility and affordability constitute the major constraint to
housing developers (Ikejiofor, 1997; 1998a; Egbu, Olomolaiye & Gameson , 2008). For instance the
study of Egbu, Olomolaiye & Gameson (2008) shows that formal land acquisition and its requisite
development rights the developer needs to spend 381 days (one year and two weeks) when all the
requirements are fulfilled. While according Ikejiofor (1997) 10 % of the small- scale developers
respondents in Abuja secured land from government source. Abuja experience one of highest land
prices in the country and of recent the land price has been reviewed by over 900 % (DailyTrustonline,
2009). The advent of PPP mass housing scheme (MHS) came as a relief to OPS developers in
accessing land for housing development, where the land is made available as public sector equity
contribution to the partnership.

However, the inept management generate a lot of confusion by indiscriminate allocation and
revocation of plots without recourse to due process and even to the extent of allocation of non-existent
plots (FCTA, 2007). The report indicate that allocations were made without due recourse to other
stake holder departments. At most times the OPS cannot have a development planning of the project
with absolute confidence. For instance, 56 OPS developers were affected by relocation amount to land
size of 874 hectares, ranging between 5 and 40 hectares to individual developers (Table 3). There
were some allocations that were revoked for non-compliance with terms of agreement. But such
developers were reinstated to their plots after been reallocated to other developers. The double
allocation against on one plot has created conflicts between the developers themselves. Many times
the reinstatements of such allocations by the PPP unit were not communicated to the other stake
holder departments and agencies for appropriate updating of records, further to add confusion and

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senselessness of the implementation. The effects of this attitude, the development of the plots were
put off pending the resolution of the conflict.

Table 3.Number of OPS affected by relocation and revocation of land (in ha) under the PPP scheme in
Abuja

S/N District No of OPS for Total land No OPS for Total land size
relocation size revocation revoked/withdrawn
1 Wumba 22 200 2 15
2 Kafe 1 100 2 40
3 Galadimawa 4 85 4 80
4 Dakwo 11 129 - -
5 Lokogoma 8 190 2 30
6 Mbora 10 170 - -
Total 56 874 10 165
Source: FCTA (2007: 4-12)

The interviews with households and developers (Interviews, 2010) show that the issuance of C of Os
was yet to commence in respect of the PPP housing estates so far completed. On the part of the DMS
attributed the delay to the developers, who were yet to make submission of the list of their
beneficiaries to the relevant department. In any case this negates the whole idea of conferring titles to
the beneficiaries, which they could have use the title document to source for capital or even to arrange
for mortgage to cover the initial cost of acquisition of the houses sold on “cash and carry basis”.

The Abuja property market is characterised with uncertainties and the participating OPS are not
spared. The property market and development at all times await the announcement of revocations of
land in Abuja as soon as there is change of ministerial appointment. Abuja had 13 ministers from its
34 years of history and on the average the ministers spent an average of 2.6 years of governing the
ministry. Of recent it is reported that the newly Minister of FCTA appointed in April has ordered the
revocation of land allocations of the immediate past administration (DailyTrustonline, 2010b). The
reasons at most times given include favouritism, non-compliance of due process and nepotism in the
land allocation process.

To date there are conflicting records of land allocations to OPS developers from the records of DURP,
DCD, AGIS and DMH. On the general note all the stakeholders departments do not have accurate
records of the OPS developers, development and management, in terms of number of housing units
under construction, constructed and disposed. The practice of implementation is absolutely not under
the FCDA/ MFCT supervision, coordination and control.

The Abuja Master Plan stipulates that any development to be executed, a detailed site and
development plans and engineering design are compulsory. But the allocations of the MHS were
made “arbitrarily without recourse to neither the detailed site development plan nor engineering
design for those districts” (FCTA, 2008:28). The FMFCT/FCDA did not have the detailed prepared
land use plans and engineering designs of the districts before the allocations were made to the OPS
developers. With this abnormally, the private developers also went into development without equally


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preparing their individual estates land use plans and engineering designs. Even the few that submitted
the plans and design, many did not secured the Department of Engineering Services (DES),
Development Control Department (DCD) and even the Department of Urban and Regional Planning
(DURP) approvals, but all the same went ahead with the developments. When planning was done by
the DURP later, made some private developers lost their allocations and some also lost their
allocations on the ground that their plots were taken over to accommodate the proposed
Commonwealth Games village 2010.There were cases of multiple allocations, encroachments and
disputes between the private developers.

Another setback experienced in the course of the implementation, the government did not fulfil its
part of agreement of providing the primary infrastructures due to the funding constraints. There are
many of the plots in districts allocated for MHS for more about ten years without the provision of
infrastructures made. For instance from the records of the DES shows that the FCDA cost of
providing infrastructure to relatively flat and rough terrains in Abuja was estimated at about N10,000
and N17,500 per square metre respectively. Consequently, there were some OPS developers carried
out development without the prerequisite physical infrastructure. It is based on the anticipation that
such infrastructures would be provided later. The interview with the private developers (Interview,
2010) shows that the failure of the government to provide these infrastructures necessitated them to
make such provision, like access roads, water, electricity main and transformers at their sites to make
the estates habitable and which all add up to the cost of the developments, with serious consequence
to unit price of the houses produced.

Institutional setting, regulations and control of PPP housing estates in Abuja

Of recent the PPP strategy enables the public sector to consolidate the realisation of building structure
high standards in the urban areas. This is what the officials in Abuja reiterate that the private partners
must built “standard housing”. To guarantee this, the operational PPP guidelines set high minimum
standards to which all the OPS must conform and also along the line of Abuja master plan standard.
Before now such goal has been criticised by scholars (see Morah, 1993; Ikejiofor, 1999a).
Consequently, such urban planning contributes to poor exclusion and part of problem of housing the
LIGs (Watson, 2009).

Nevertheless such declared goal was far from been realised under the OPS development. The
developers were expected to submit their building and land use plans, drawings and the engineering
designs of their internal network of services to relevant stakeholder departments for approvals.
Unfortunately, the responsible agencies allowed the private developers went into development
without prior approvals of their developments. For instance, the DES observed the consequence of
such development made by the developers in the future would create the situation where the estates
internal services infrastructures might not be able to integrate with the whole city infrastructures “due
to differences in levels and in some situations , encroachment on the roads right of way”(FCTA,
2008:34-35). The records of the DCD prove further the above claims. The FCTA (2008) report shows
that from the 79 private developer’s onsite, only 51 or 64.5 % made applications for development
approvals and only 13 private developers’ secured requisite approvals of the DCD. The participating


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developers of MHS are carried out without securing the requisite approvals from the relevant
authorities.

The observed discrepancies on the way the MHS was implemented, specifically without coordination
and supervision, the report observed that “many of the buildings in the ... sites were poorly executed
using poor materials” (FCTA, 2008:47-48). The poor nature of the workmanship prompts the DCD to
demolish 127 structures in one OPS housing estate at Kafe district and in another instance some of the
estates have registered cases of building collapse under the scheme (FCTA, 2008). Further
investigations (Interview, 2010) demonstrated that some of the LIG that they bought the houses in the
estate not for house per se, but for the sake of the land. These occupants later demolish the house and
reconstruct new structures. The implication of these shows that the stakeholder departments were not
carried along to coordinate and monitor the developments and in fact there was no existing standing
committee that comprises of all the stakeholder departments responsible for the coordination,
monitoring and review the performance of the MHS in Abuja, to ensure success of the scheme.

The development lease agreement that the developers were made to sign before the commencement of
the project completely was discarded and disregarded, which ordinarily should have act as guide,
standardisation and moderator of the projects between the parties of the contract. However, both
actors were working outside the context of the agreement. There was failure from the relevant
departments to enforce sanctions from the breaches of the development lease agreement. The end
result shows that the private sectors were producing houses and infrastructures that were not in
compliance with the specification of the development agreement signed. The mixed development
densities in the form of detached, semi-detached, terraced and block of flats known with Abuja
development was apparently ignored and dumped by the private developers. Much of the
development by the private developers concentrates on high and medium costs, with very few units or
none at all of low-cost, in the form of mansions, duplexes, bungalows and few units block of flats
targeting the rich and none for the poor. Even the authorities of FCTA criticised such extensive low-
density developments that were not commensurate with values of land in the city, considering the
high cost of infrastructure provision in the city (FCTA, 2008).

Financing and accessibility of PPP housing estates in Abuja

Under the NHP reform, the FMBN opened what it is called “estate development window” to OPS
developers and “NHTF loan window” to PMIs, to attract massive participation of both developers and
house buyers in mass housing delivery in the country. The loan to be accessed by the OPS is to be use
specifically for housing development, excluding the cost infrastructure provision. The loan attracts an
interest rate of 10 % per annum (p.a), half of the prevailing rate in the private financial institutions,
limited for a period of 24 months. The plan initially targeted only the NHF contributors. Therefore,
the houses units’ prices must be between NGN1.5 million and NGN5.0 Million. If the developers
were to develop outside the cost and housing plan units specified, must then be financed from their
resources. Initially, to ensure that the NHF contributors secured the allocation, the developers were
required by the FMBN to obtain and present list of such contributors’ commitment, through an
accredited PMI. Perhaps this explained why all the OPS developers have one subsidiary PMI or have
a retainer ship PMIs to do the marketing of the estate to the prospective buyers. Other requirements

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include REDAN membership and the developer must obtained bank guarantee. Only two of our six
OPS developers’ respondents accepted to have access this loan from the FMBN. Others claimed to be
using their company resources and bank loans.

Just like land grabbing observed above, many OPS jostle to access the loan, few with good intentions
to use the resources for the purpose it is meant for, other see it as opportunity to grab from the FMBN
as their share of ‘national cake’ (Housing, 2005). The result of the implementation shows the
insincerity and fraudulent practice of some OPS have diverted the loan to other uses and some could
not settle the loan as when due, and the amount could not revolve to other developers to access the
fund. In fact from this attitude of OPS developers were indebted to FMBN to the tune of NGN11.24
billion (about USD$75 million) (NBFTopicsonline, 2009). And from the list of indebted OPS we can
identify that those three of the OPS respondents that refused to disclose to us whether they have
access the loan and are to be found to be indebted to the tune of about NGN2.5 billion (about
USD$17 million) accounting for more than one- fifth of the total loan outstanding. The construction
sites of MHS estates at the time of the field work there were very few of the developers on site and the
developers attributed the suspension of the construction works to the factor of inadequate funds to
continue the construction. Lately the REDAN have attributed the abandonment of the projects to the
Central Bank of Nigeria (CBN) bank reform that made the banks weakened to provide funds and
guaranteed to secure financing from the FMBN (Guardianonline, 2010).These factors
notwithstanding, there were no adequate monitoring from the responsible institutions to ensure strict
compliance, which allowed much of the funds to be diverted to other uses other than the purpose for
which it is meant for. If the scheme had enjoyed the deserved adequate supervision it would have
allowed the system to make adjustments where necessary to ensure success.

Housing possesses investment potentials and it is considered as such by many investors. The
responses obtained indicate that more than 50 % and about 48 % of the respondents as renters and
owner-occupiers respectively, and about 90 % source of the houses for rent were from individual
owners. These findings suggest that many bought the houses for investment and also serve as the
available options of cost recovery. More than two-third of the respondents was in occupation of the
houses between 1 and 5 years and renting in Abuja, in most cases are for shorter duration and subject
to renewal. By exploring this opportunity afford the investors to recover part of the money invested,
generate income and perhaps to some serve as source of paying back some of the borrowed money
used to acquire the house at the first instance. Also there are quite a number of studies that reaffirm
the position of house serve as source of income, even among the LIG, that part of their premises as
means of diversifying their source of income (see Sinai, 1998; Tipple, Korboe, Garrod & Willis,
1999). The data suggests that there are emerging investors acquiring the houses developed from the
private OPS developers in Abuja, and the houses are rent out immediately. Against the background of
housing shortage among the LIGs in Abuja, there is need to put forward measures to control the
emergence of this trend in the interest of equity.

The recent study of Ndubueze (2009) finding indicates a ratio of about 3 to 5 Nigerian urban residents
were having housing affordability problem. Also other researchers have shown that income level
prove as the major factor that affect house purchase (Arimah, 1997; Udechukwu,2008) and sourcing
of loans from formal financial institutions in Nigeria (Ojo & Ighalo, 2008). From the study data, the

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annual income of the respondents at the time of house purchase and now obtained shows that majority
of the respondents (84.7 %) earn more than NGN100, 000 p.a and the remaining 15.3 % earned less
than NGN100, 000. Using the NHP, 2006 bench mark, the result shows this the majority that bought
the housing units are outside the bracket LIGs. Further details of the data shows only 24 % used
FMBN facilities to purchase the houses. While 43 % source the money from personal saving and
assistance from relations, bank loan and employer financing account for 27 and 6 % respectively. This
shows the interplay of traditional source of housing for most Nigerians through accumulation of
savings and assistance by borrowing from relations and friends occurring in the acquisition of houses
on these estates. Considering the focus of the NHP, 2006 on mortgage financing, the implication of
the findings indicate that not much has been achieved and perhaps the inadequate accessibility to this
type of financing perhaps might be the explanation for negligible number of LIGs participating and
dominance of the market by the emerging group of investors buying over the houses developed by the
OPS.

Another finding of the study indicate that the developers offer choice of full cash and instalment
payments, which the purchasers are expected to complete within a maximum period of between 3 and
6 months, which varies from the developers. The instalments payment terms regime also varies, but
most common are 70%- 30%; 50%-30% and 20 %; 30 %- 40 % and 30 %. The data shows that more
than 60 % and about 22 % made upfront payment of between 11 and 49 % and more than 50 %
respectively. Contrary to Mabogunje (2004a, b) the finding demonstrate that the emphasis on cash and
carry basis housing market has not changed with the housing policy that encourages home ownership
through mortgage financing. This study further strength the findings of Struyk & Roman (2008)
which shows under nascent mortgage there is low-incidence of mortgage financing with about 25 %
and cash payment prevails with about 3 of every 4 house purchase in Cairo.

Summary and concluding remarks

The existing literature on the Nigeria housing policy over the years dwelt so much on the failure of
the public housing scheme and its associated issues and there has being very little study on the PPP,
particularly the participation of the OPS. This study examined the public sector and OPS role towards
the provision of housing to the LIGs through PPP in Abuja, Nigeria. The finding of the study shows
that it is not tenable to posit that the adoption of PPP as a strategy of housing the mass people of
Nigeria has solved the problems of accessibility and affordability to housing among the LIGs.
Conversely, it can be argued that the strategy of enablement, OPS has become a formidable and
virtually impenetrable barrier to access to majority of Nigerians, despite government support of land
and financing. The strategy has succeeded by further marginalising and deepening the exclusionist
posture of the housing market to majority of Nigerians and effectively undermined and stunted the
growth and development of the housing sector/ home ownership to near incapacitation. The spiral
effect of the failure of this scheme has contributed significantly to the further densification of the
informal settlements around the city.

Furthermore, this study has provided a number of insights into the institutional failures in an attempt
to resolve the challenge of housing. The experience shows some of the procedures spelt were grossly
violated. Therefore, the MHS scheme in Abuja was executed without proper procedure, adequate

Millennium


planning and implementation. The scheme also suffered from lack of coordination and monitoring
from the relevant stakeholder departments of the FCDA and the worst originate from the ad hoc
committee that first administer the scheme. This singular institutional failure brought about the
confusion, lack of focus, coordination and encouraged non-compliance. It has shown the effects of
weak institutional framework to successfully coordinate and monitor the progress of this onerous task
of housing Nigerians. The ultimate goal of the whole exercise has become a mirage to the Abuja
residents, but in particular to the LIGs. The worst outcome from the study shows that the scheme is
completely disconnected from the overall framework of the country’s national housing policy, that
prioritise to achieve housing for all Nigerians to own or have access to decent, safe, and healthy
accommodation at affordable cost through mortgage financing. The study reiterates the need to further
conduct in-depth reflections on ways to address this contentious issue of housing the LIG. Also the
existing institutional framework needs to be overhauled and repositioned on ways best to address this
challenge to realise the objective of the NHP, 2006 “to ensure that all Nigerians own or have access to
decent, safe, sanitary housing accommodation at affordable cost”.


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